Surge may still be allowed up to 3 times despite cap

Days after chief minister Arvind Kejriwal made it clear that surge pricing would not be allowed in Delhi, government officials say that the “ban” is not on surge pricing but on “extortionism”.Rumu Banerjee | April 23, 2016, 08:59 IST

NEW DELHI: Days after chief minister Arvind Kejriwal made it clear that surge pricing would not be allowed in Delhi, government officials say that the “ban” is not on surge pricing but on “extortionism”.

“The Delhi government hasn’t asked the taxi aggregators to stop surge pricing, but only to follow law. Surge can still go up to three times with the cap in place,” said an official.

A look at the fares of the taxi aggregators such as Ola and Uber reveals how their rates are different from the ones set by the Delhi transport department. While Ola charges Rs 6 per km for its ‘Micro’ option, Uber charges Rs 7 per km for UberGo, it’s entry level cab service.

The minimum charge or the base fare for both Ola Micro and Uber is Rs 40. This is different from the radio taxi fares that are set by the transport department. It’s Rs 23 per km for radio taxis—AC cars—while the rate for economy cabs is Rs 12.50 per km.

Added the official, “Essential public services require some government regulation to maximise the benefits. Any taxi in Delhi can charge these rates. There isn’t any need to suspend surge, which the taxi aggregators have done on their own. All they need to do is cap it.”

Ironically, this argument hasn’t gone down well with either the taxi aggregating services or the registered radio taxi companies. Abhishek Sharma of Ridz, which runs an app-based taxi service with a permit from the Delhi government, rues the fact that aggregators have been lionising the taxi segment.

“Ridz has been charging a flat rate of Rs 12.50 per km in accordance with government norms,” said Sharma, adding that despite flouting rules, taxi aggregators have been plying in the city. He pointed out that these companies neither have the permit nor the authority to decide on fares, which is the prerogative of the State Transport Authority (STA).

The government may consider the issue of legality like permits at a later stage. “The matter is in court. We are also coming out with a policy for taxi aggregators to address the shortfall in the present policy,” said an official.

But till the new policy comes, the fares would be under scrutiny, said sources.

The official added that the rates set by STA was the maximum fare. “But companies can charge less than that to attract more customers. There’s no minimum limit,” said the official. The “ride charges” levied by the aggregators could come in for an official scrutiny though.